Alvin Tan on impact of rising interest rates on financially distressed consumers

Despite rising interest rates, the number of financially distressed consumers who have sought assistance from banks is "not high" and has been decreasing over the past year. Minister of State for Trade and Industry and Monetary Authority of Singapore board member Alvin Tan said this in response to a Parliamentary question on Monday (May 9), adding that broader indicators also suggest the resiliency of household and corporate debt situations. He said recent market-driven interest rate increases have been accompanied by continuing income growth, mitigating the impact on the debt-servicing ability of most borrowers. However, he noted that more highly leveraged households and companies with lower profit margins who foresee running into difficulty should seek refinancing and assistance early. He also cautioned that consumers should be more prudent in new borrowings.